The New York Times on the front page of their Business section today has an article “A New Divestment Focus: Fossil Fuels” that provides an overview of the efforts on campus, led by Bill McKibben’s 350.org initiative, to get universities and colleges to divest from fossil fuels in their endowment and other portfolios. As they say:
In the 1980s, it was South Africa. In the 1990s, it was tobacco. Now fossil fuels have become the focus of those who would change the world through the power of investing.
The response by colleges and universities has been largely, according to the article, to sidestep divestment as a way to influence policy and use of fossil fuels, except for a feww small colleges. Some excerpts:
A few small colleges have chosen to divest themselves of their fossil fuel stocks. Unity College in Maine, which specializes in environmental science and has a small $14.5 million endowment, this spring completed a move to a lineup of 33 exchange-traded sector funds that minimize exposure to fossil fuel stocks. “If we don’t deal with climate change now, we consign our grandkids to an unlivable planet,” said Unity’s president, Stephen Mulkey.
A Harvard spokesman, Kevin Galvin, [stated], “The university has traditionally maintained a strong presumption against divesting stock for reasons unrelated to investment purposes,” preferring that the college make its “distinctive contributions to society” through its “research and educational activities.”
Christianna Wood, a trustee of Vassar College who advocates pursuing social and governance goals through engagement and proxy voting, said that when she oversaw global stock investments at Calpers from 2002 to 2007, outside consultants estimated the costs of the fund’s South Africa and tobacco stock sales at $1 billion each. She said by divesting, colleges will “not only lose money, they will lose their voice” on such issues. She predicted that the movement would fail at most schools.
Administrators at Bowdoin and Swarthmore have cited such potential costs in responding to calls for divesting, and Middlebury and Vassar have decided not to divest. Middlebury cited the difficulty, costs and risks. Vassar’s president, Catharine Bond Hill, said students “have lots of proactive ways to engage policy makers” on climate change, and divesting themselves of certain stocks could hurt endowment returns without addressing the causes of climate change.
For the full article, click here: